The Joint Committee on Human Rights has recently
considered the Proceeds of Crime Bill. Its report of these preliminary
considerations will be published early next week. In the meantime,
the Committee has instructed me to seek answers to the following
questions which arise from its examination of the Bill with respect
to its compliance with Convention rights.

1. Statutory assumptions, fair trial, and
the presumption of innocence

Clause 11 of the Bill as introduced incorporated
four statutory assumptions which courts are required to make when
assessing a defendant's benefit from crime following conviction.
The court would have to make these assumptions unless satisfied
on a balance of probabilities that they are wrong or that making
them would cause injustice. The process assumes that certain defendants
have benefited from criminal conduct of which they have not been
convicted, in addition to that of which they have been convicted.
The Committee's provisional view is that the requirement to make
the assumptions does not engage the right to be presumed innocent
until proved guilty under Article 6(2) of the ECHR. The Committee
also provisionally considers that the requirement is not intrinsically
incompatible with the right to a fair hearing under Article 6(1),
as long as the court does not make assumptions for which there
is no supporting evidence, and makes due allowance for situations
in which it would be impracticable for the defendant to satisfy
the burden of proof which the legislation places on him or her.[1]

However, the Committee considers that there
may be advantages, in terms of legal certainty, if the statutory
assumptions were to be drafted in a way that incorporated those
considerations expressly in the duties of the courts under the
legislation. It invites the Home Office to respond to this view.

2. Compatibility of the confiscation order
regime with the right to the enjoyment of property

There would normally be no doubt that a defendant
is entitled to the property subject to a confiscation order. The
order will therefore usually constitute an interference with the
right to enjoy property under Article 1 of Protocol No. 1 to the
ECHR.[2]
The interference may be justified under that Article if it is
"in the public interest and subject to the conditions provided
for by law and by the general principles of international law."
The state has the right "to enforce such laws as it deems
necessary to control the use of property in accordance with the
general interest or to secure the payment of taxes or other contributions
or penalties." A confiscation order is such a penalty, but
the imposition of the penalty must still meet the condition that
it is in the public interest and subject to the conditions provided
for by law and by the general principles of international law.[3]
This requires that there be "a reasonable relationship of
proportionality between the means sought to be employed and the
aim sought to be achieved".[4]
A proper balance must be struck between the public interest and
the rights of the property owner.

In Phillips v United Kingdom,
the European Court of Human Rights unanimously decided that confiscation
orders in drug trafficking cases satisfy these tests. However,
it is arguable that the Bill, like the current legislation applying
to confiscation orders, makes it possible to impose confiscation
orders on defendants whose level of criminality differs widely,
particularly when the prosecution relies on a course of criminal
conduct or a "criminal lifestyle".

The Committee seeks a further explanation of
the grounds on which Ministers are satisfied that the requirement
of proportionality is likely to be met, in all cases not involving
drug trafficking, in which a court would have a duty to make a
confiscation order after applying the statutory assumptions under
the procedures proposed in the Bill.

3. Protecting the interests of members of
a defendant's family in the family home

In relation to Scotland, clause 101 of the Bill
as introduced makes special provision to protect the interests
of members of the defendant's family in the family home where
it forms realisable property (as part of the defendant's assets)
but the prosecution has not satisfied the court that the home
was acquired as a benefit of criminal conduct. In the Committee's
view this would appear to provide valuable additional protection
for the right to respect for the home of the defendant's family
under Article 8 of the ECHR.

The Committee seeks an explanation as to why
no similar express provision is made in respect of England and
Wales or Northern Ireland.

4. The right to legal representation in civil recovery proceedings under the Bill.

The Committee has provisionally formed the view that civil
recovery actions under Part 5 of the Bill might fall to be regarded
as involving a "criminal charge" for the purposes of
Article 6 of the ECHR, in view of the autonomous meaning given
to that term by the European Court of Human Rights. This makes
it possible that the respondent in such proceedings would be entitled
to rely on the rights under Article 6(2) and (3), as well as the
right to a fair hearing under Article 6(1).

The first question to arise from this relates to the right
to defend oneself through legal assistance of one's own choosing
(Article 6(3)). Where an interim receivership order is made pending
trial of the action, to preserve assets which might become subject
to a recovery order, clause 255(4) of the Bill as introduced expressly
forbids any exclusion to enable any person to meet any legal expenses
in respect of proceedings in relation to the application for the
recovery order. Where a large part of the respondent's assets
is subject to the interim receivership order, this may effectively
deprive the respondent of the right to choose his own legal representative.
It would interfere significantly with the rights of the defence
(as well as potentially placing a significant additional burden
on the legal aid fund). It contrasts in a notable way with the
treatment of people subject to restraint orders under the confiscation
legislation (Parts 2-4 of the Bill), which can be subject to exceptions
for reasonable legal expenses.[5]
A threat to rights under Article 6(3)(c) might only be thought
to be justified under the recovery order procedure if it is assumed
that the proceedings do not involve a criminal charge. As noted
above, this assumption, if it is being made, is in the Committee's
view, questionable.

Additionally, the Committee considers that even if Article
6(3) were not applicable, Article 6(1) would be, because the recovery
of assets involves a determination of the respondent's civil rights
and obligations.[6] Article
6(1) includes a right of access to a court, which the Committee
believes is potentially compromised by denying a respondent the
right to use his or her own property (albeit property which is
suspected of having been obtained as a result of criminal conduct)
to secure legal representation to defend his or her rights. There
may be circumstances in which refusing to permit reasonable legal
expenses to be paid for out of the property would necessitate
granting legal aid at public expense in order to comply with Article
6(1).[7]

In the light of the need to secure compatibility with Article
6 of the ECHR, the Committee seeks an explanation from the Home
Office as to why clause 255(4) is thought to be appropriate.

5. Retrospectivity

If the Committee's provisional view that civil recovery proceedings
might be criminal for the purpose of Article 6, it would follow
that the right not to be retrospectively subject to a criminal
penalty under Article 7 is engaged. A recovery order is likely
to be regarded as a penalty under Article 7 of the ECHR, because
(like the confiscation order in Welch v United Kingdom)
it has no compensatory role, is a consequence of criminal conduct
having been established, and potentially subjects the respondent
to an order of considerable severity.

This causes the Committee some concern. The civil recovery
regime would apply to property obtained before the Bill, if passed,
would come into force. This retrospective operation would be unlimited
as to time, because the Bill provides that the normal statutory
rules on limitation of actions will not apply to applications
for recovery orders.[8]
The unlawful conduct which would make a person liable to have
property taken away could therefore have occurred at any time
in the past, when he or she would have had no knowledge of potential
liability to a recovery order.

The Committee seeks a further explanation as to why Ministers
believe that the retrospective operation of the proposed recovery
order regime would be compatible with Article 7 of the ECHR.

6. Other representations relating to compliance with Convention rights, etc.

The Committee also wishes to be informed of other representations
the Home Office has received relating to the compatibility of
provisions of the Bill as introduced with human rights obligations.

7. Undertakings

The Committee would also be grateful for details of any undertakings
given so far by Ministers to Parliament to consider, or bring
forward, amendments to the Bill in relation to the above questions
or related matters.

The Committee would be grateful for your responses to the
above questions by Monday 8 January 2002. It may thereafter wish
to make a further report to each House on issues which, in its
view, have been satisfactorily dealt with or remain unresolved